Craigslist Used Cars Listings And Actual Dealers

By James L Kirkland

Don't Be Caught By Surprise: A Craigslist Used Cars Scam And Actual Dealers

More and more people are selling their used cars on Craigslist. However, dealers are also cashing in on this "individual-selling" aspect so they don't need to comply with the Federal Trade Commission's rules about used cars and used car dealers.

How The Grey Process Works

You won't know until after the sale is done that you have purchased a used vehicle from a used car dealer. Here's what happens in these kinds of cases:

1 - You see a Craigslist ad about a vehicle you like and call to check it out.
2 - You meet the "owner" at a private residence where the seller tells you the reasons why the vehicle is for sale. They don't mention that they are a dealer.
3 - The used car history report will give rest to any suspicions you have about the vehicle.
4 - You're not dumb when it comes to buying used cars and decide to get an independent inspection. The "dealer" is fine with this since it doesn't report who the present-day owner of the vehicle is.
5 - While the used car history report is not a fraud, it's likely to have been pulled before the dealer purchased the vehicle. That means the sales transaction between the previous owner and dealer is not going to be listed.
6 - You decide to buy the vehicle, make a deal and the dealer helps you out by getting the car registered in your name. It's only until you get that final paperwork that you see the seller was actually a dealer.

Why Dealers Go This Route To Sell A Vehicle

Why would a dealer go through this much trouble? According to the Federal Trade Commission website, the Used Car Rule calls for dealers to have a Buyer's Guide on all used vehicles they are selling. This Buyer's Guide offers a good deal of information such as:
1 - If the vehicle is being sold "as is" or has a warranty.
2 - What percentage of any repair costs the dealer pays for under the warranty.
3 - The fact that verbal promises are harder to enforce.
4 - The vehicle's major mechanical and electrical systems including the big problems to watch out for.

The Buyer's Guide will also give the following information:

1 - Obtain all promises in writing.
2 - Hold onto the Buyer's Guide even after the sale to refer back to it.
3 - Ask to have the vehicle inspected before buying it from an independent mechanic.

The FTC points out that purchasing a vehicle from a private car seller is different from purchasing from a dealer. Private vehicle sales are not covered by the FTC's Used Car Rule. Private sales are as is and, if anything goes wrong after the sale, you're the one paying for it.

As you can see, a used car dealer posing as a private vehicle seller can avoid many of these "selling" headaches. Plus, it's nearly impossible to find out about complaints about them from the Better Business Bureau.

Of course, Craigslist isn't the only place you'll find this sort of grey area of processing car buying deal. It's just one of many sites but Craigslist is the most popular site for scams.